Florida Leads Multi-State, Multi-Million Dollar Settlement with Conseco Life Insurance Company
Jun 30, 2010
Led by the Florida Office of Insurance Regulation and regulators from California, Iowa, Indiana and Texas, a multi-state effort has resulted in an agreement among 37 jurisdictions and Conseco Life Insurance Company (“Conseco”) to establish a $10 million fund to compensate certain Conseco policyholders, approximately one-third of whom were Floridians.
The agreement was announced by the OIR today, June 30, 2010.
Hyperlinks to the agreement are contained in the OIR news release reprinted below.
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Florida Leads Multi-State, Multi-Million Dollar Settlement with Conseco Life Insurance Company
TALLAHASSEE, Fla. – Florida Insurance Commissioner Kevin McCarty today announced a multi-state settlement agreement among 37 jurisdictions and Conseco Life Insurance Co. (Conseco) that requires the establishment of a $10 million fund for certain owners of its Lifetrend life insurance products. Participation in the settlement is voluntary.
The Florida Office of Insurance Regulation led the multi-state effort with insurance regulators from California, Iowa, Indiana, and Texas. The sale and administration of the Lifetrend policies were reviewed after receiving complaints from consumers who had received notices in the fall of 2008 regarding increases in policy costs. Of the 12,247 Lifetrend policies that remain in force, 4,321 are owned by Floridians.
“I am pleased to report Florida has worked collaboratively with the other lead states to reach an agreement with Conseco,” said Insurance Commissioner Kevin McCarty. “Conseco has agreed to create a multi-million dollar settlement fund to provide relief to policyholders in Florida and nationally who purchased Lifetrend policies.”
In addition to the settlement fund, Conseco will pay a $1 million monetary assessment to the jurisdictions participating in the settlement. Florida’s share of the assessment will be approximately $200,000, based on a formula outlined in the agreement.
The settlement agreement also requires Conseco Life and its affiliates Conseco Insurance Co., Conseco Health Insurance Co., Bankers Life and Casualty Co., and Washington National Insurance Co. (collectively referred to as “Companies”) to improve their processes for identifying and correcting administrative system issues. The Companies will undergo a two-year process improvement monitoring period.
The Company will notify consumers beginning mid-July and continuing through the end of the year. The mailing will include a dedicated toll free number for Lifetrend policyowners to call the company with their questions.
Click here for a copy of the regulatory settlement agreement.